Apparent consumption = Production + Imports - Exports - Bunkers +/- Stock Changes.
It is a top-down approach that assumes all primary energy production in a country is utilized domestically, exported, utilized in ports or in international transit, or added to existing stocks (Macknick, 2009, p. 8).
This research will also assume that there is an energy alternative that can reduce CO2 emissions in order to attempt to provide a framework to a solution for the emissions concerns. These primary energy equivalencies are depicted by Macknick (2009) in Table 1 (p. 13):
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Other assumptions that will guide this research are that there are current standards to which transport vehicles are obligated to operate, these standards will be revised using new policy with considerations on climate change, and policy will dictate how technology will enable companies to adhere to these new standards.
From these assumptions, the research will suggest strategies for companies to consider while approaching the reform of CO2 emissions in the transport industry. These strategies have been adapted from the research of the EU legislation (2008) and are as follows:
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Road Freight: increasing the rate of vehicle utilization, reducing empty running, improving driver training (could lead to a 20% reduction in fuel consumption), developing the use of route-management software to reduce the distances covered.
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Rail Freight: to encourage technical harmonization and interoperability in conventional rail; to improve the use, management and pricing of rail infrastructure; to clarify the relationship between the State and the railways.
- Air Transport: drawing up stricter international emission standards; promoting the efficiency of the air transport system (targeted taxation, improved pricing, and limited flight distances); promoting alternative modes of transport wherever possible.
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- Efficient Infrastructure: reinforcement of the role of national, regional and local authorities in traffic management (speed control, information campaigns, promotion of non-polluting modes of transport such as the bicycle, restricting traffic in urban areas); introduction of a land-use plan taking environmental considerations into account; development of new, less polluting propulsion technologies (hybrid cars, fuel cells).
- Technological Cost Reductions: the demonstration of and experimentation into new transport technologies; the promotion of new fuels such as bio-fuels; improved coordination of all stakeholders through the adoption of action plans; the implementation of a system to follow-up and monitor the evolution of transport-related CO2 emissions.
This research will attempt to establish a framework through other’s research concerning plans and strategies to implement the above strategically oriented proposals into action plans. The study will review the literature of research concerning CO2 emissions, outline the problem of CO2 emissions, identify standards for company level emission allowances, determine if these allowances are suitable for today’s climate, and propose action plans for lowering CO2 emissions through technology and policy procedures.
Ethical Issues
There are several anticipated ethical issues that this research will keep in consideration while documenting the finding and suggesting resolutions to the problems the findings may suggest. First, who should take responsibility for the reduction of CO2 emissions? Second, what sector of the transportation industry will be most affected by the change in CO2 emissions policy and technology? Third, which companies should do more do more to limit CO2 emissions? Finally, do more profitable companies have an obligation to help less profitable companies conform to new policy and regulations?
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II. Literature Review
An ever developing issue in the field of transportation and logistics management is concerning CO2 emissions from various types of transportation systems. A key focus in the CO2 emissions discussion is establishing ways to lower these emissions. Three ways in which researchers have examined the effects of lowering CO2 emissions are looking at the current climate change caused by these gases, developing and improving government and state level policy, and implementing these policies through technological improvements both currently available and theoretically designed. Now that the effects of lowering CO2 emissions have been stated, we must start to turn our attention to how we can mitigate changes through resourceful measures.
Climate Change
To begin the discussion on climate change, first we must review the logistics and transport sector carbon footprint. If we examine the world-wide CO2 emissions from 1991 to 2005 it can be seen that emissions of CO2 are increasing by almost 3% each year; see Graph 1 below (Rohrer, 2007):
According to a report prepared by the World Economic Forum the logistics and transport sector has a carbon footprint of around 2800 megatonnes CO2e in which road freight plays a major part and where mineral and food transportation are the largest contributors by product category (World Economic Forum, 2009, p. 8) The research also pointed out the key characteristics of carbon emissions
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in the freight sector. These name road freight as the leading contributor to freight transport globally, air freight as being a highly carbon intensive mode of transport, ocean and rail freight as the most carbon efficient, and mineral and food products as major sources of transport emissions (World Economic Forum, 2009, p. 8).
In a study by the U.S. Department of Transportation Federal Highway Administration there were two astonishing finding on green house gas emissions. The EPA examined six green house gas pollutants and first found that the six pollutants endangered public health and welfare and was labeled an “endangerment finding” (U.S. Department of Transportation Federal Highway Administration, 2009, para 5). The second finding stated that light duty vehicles contributed to green house gas pollution that threaten public health and welfare and was labeled a “cause or contribute finding” (U.S. Department of Transportation Federal Highway Administration, 2009, para 5). A complete breakdown for direct-fuel use energy consumption sectors from 1990 to 2008 is offered in Graph 2 by the U. S. Department of Energy (2009):
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American Society of Mechanical Engineers recommends two ways of dealing with the challenges of climate change. The first being to adapt to the consequences and the second is to minimize climate change by reducing green house gas concentrations (American Society of Mechanical Engineers, 2009, p. 4). The study provides several examples of adaptation as well as suggesting that there are several “infrastructure and societal changes that might be required to suitably and economically limit the consequences of climate change” (American Society of Mechanical Engineers, 2009, p. 5). A result of these ideas, total emissions in the transport sector have seemed to be falling from 2007 to 2008 in relation to oil use as depicted in Graph 3 by the U. S. Department of Energy (2009):
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Policy
A report by the Committee for the Study on the Relationships Among Development Patterns, Vehicle Miles Traveled, and Energy Consumption, and the National Research Council provides the a call to action among policy makers. They indicate that policies should encourage and “support more compact, mixed-use development and reinforce its ability to reduce vehicle miles traveled, energy use, and CO2 emissions” (2009, p. 131). Studies have shown that there is a great need to create a framework for transport providers to emplace regulations for the CO2 emissions issue. Sperling and Yeh focus on three initiatives to decarbonize transportation: these are “improving vehicle efficiency, reducing vehicle use, and decarbonizing fuels” (2009, p. 58). They focus their research on the latter of these ideas and provide three principles for policy makers to approach to the issue. “It must inspire industry to pursue innovation aggressively, it must be flexible and performance based so industry picks the winners, and it should take into account all green house gas emissions associated with the production, distribution, and fuel use, from the source to the vehicle” (Sperling and Yeh, 2009, p. 58). In addition to policy makers merely making policy, they must also play an active role in decarbonization of the entire supply chain. They must work with transport providers to ensure that these policies are in place and that the policies are working toward their intended goals. The World Economic Forum list several areas in its research where a team effort between the aforementioned three groups will be necessary to begin a successful decarbonization campaign. These are energy pricing, carbon reporting, carbon trading, congestion, capacity expansion, carbon labeling, recycling and waste management, and green buildings (World Economic Forum, 2009, p. 31).
The research conducted by American Society of Mechanical Engineers proposes that policies to reduce CO2 emissions must be developed to “minimize or disallow any barriers which otherwise could preclude action and empower avenues of discovery, innovation and commerce to enable real, measurable progress” (2009, p. 25). The report goes on to recommend six steps in a proposed policy
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framework to address CO2 emissions. These recommendations highly emphasize the need to improve technology and “implement technologies that reduce CO2 emissions (American Society of Mechanical Engineers, 2009, p. 25). The research points to a track that must be followed in order for any new policy to have an effect. Research shows that this plan follows a series of steps in order to provide realistic, attainable plan to achieve that goal. One such way that is indicated is policy implementations of renewable fuel standards. The U.S. Department of Transportation (2008) shows how renewable fuel standards can be beneficial as a starting point in decarbonization (p. 5) in Graph 4:
Improving Technology
Improving technology is more than creating vehicles that run on water or inventing an ingenious device that propels goods and services through the air powered solely by wind. While these are intriguing they are still a bit out of reach. As opposed to focusing on certain sectors of transport systems, the American Society of Mechanical Engineers suggests “effectively designing capacity and efficiency
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parameters of the existing road and public transport infrastructure and developing land use and transportation strategies that optimize spatial location and transport policies” (2009, p. 16). Changes to successfully reinvent transportation include stipulations such as developing and deploying advanced battery systems to implement electric vehicle technologies and optimizing and developing propulsion technologies (American Society of Mechanical Engineers, 2009, p. 16). The World Energy Council (2007) has identified six breakthrough technologies that have the potential to greatly reduce CO2 emissions; they are identified in Table 2 (p. 62):
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Congress has also been active in improving technologies in transport system through the Energy Independence and Security Act in December of 2007 (Sperling and Yeh, 2009, p. 61). It was through this act that Congress began to enforce strengthened renewable fuel standards. Sperling and Yeh’s research suggests that these new standards forced “vehicle manufacturers to divert resources to improve engine combustion and emission-control technologies” (2009, p. 57).
The research done by the World Economic Forum attaches importance to the changes that have taken place within transport systems and laws enacted by Congress but they go one step further and suggest that “we have not assumed the adoption of many technologies which are not already commercially available” (2009, p. 7). Their report recommends in detail thirteen opportunities for cost-effective and attainable decarbonization. Of these thirteen the World Economic Forum places special emphasis on three opportunities where they see the most capability. The three are implementing clean and environmentally efficient vehicle technologies, despeeding the supply chain by decreasing transport load while increasing load fill, and optimized networks by improving network planning through transformation projects (World Economic Forum, 2009, p. 14).
III. Methods
This qualitative study of lowering CO2 emissions in the transport industry addresses three key aspects for transportation and logistics managers to consider while accomplishing this goal. First, this study will address the event of climate change concerning CO2 emissions and what, if anything, the role transportation and logistics managers have played in attaining lower CO2 levels in the industry. Next, the research will show the trend of old policies being used and new policies being developed that may contribute to a company’s success in attaining the goal of lower CO2 emissions. Finally, the research will
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explore the technologies, both readily available and those being developed, and seek the participant’s perspectives and interpretations of how these technologies can impact the transport industry.
Researchers have suggested that transportation and logistics managers and businesses in the transportation industry can lower CO2 emissions through policy and technology with the end goal being total decarbonization. The following is an amalgamation of proposed assumptions that have been addressed by researches concerning decarbonization:
- Significant movement is expected towards reduced supply chain carbon intensity through regulation of carbon emissions (World Economic Forum, 2009, p. 4)
- The key to supply-chain-wide decarbonization is an understanding of CO2 emissions across the system (World Economic Forum, 2009, p. 4)
- More compact, mixed-use development can produce reductions in energy and CO2 emissions both directly and in directly (Committee for the Study on the Relationships Among Development Patterns, Vehicle Miles Traveled, and Energy Consumption, National Research Council, 2009, p. 3)
- Cap-and –trade systems should be used more extensively to limit the total amount of pollution allowed (U.S. Department of Transportation Federal Highway Administration, 2009, para. 12)
- The most direct and effective policy for transitioning to low-carbon alternative transportation fuels is to spur innovation with a comprehensive performance standard for upstream fuel producers (Sperling and Yeh, 2009, p. 57).
- Policy makers should reflect the cost of carbon in energy tariffs, build open carbon trading systems, and facilitate recycling along the supply chain (World Economic Forum, 2009, p. 4)
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- There needs to be an increased emphasis and investment in education and training of the workforce in all advanced energy technologies and their deployment (American Society of Mechanical Engineers, 2009, p. 1)
- Policy makers should enhance development of infrastructures that are required to implement technologies that reduce CO2 emissions (American Society of Mechanical Engineers, 2009, p. 1)
The Grounded Theory Research Design
This research will utilize the grounded theory research approach. In this study, a general theory of the process of decarbonization and the views of the participants from the transportation industry will be used to examine the effects of CO2 emissions concerning climate change, policy, and technology. The goal of this qualitative research in using the grounded theory research approach will be to compare data within the transport industry across different transport modes “to maximize the similarities and the differences of information” (Creswell, 2009, p. 13). The comparisons of data will then be refined to propose solutions through policy and technology to attain lower CO2 emission and eventual decarbonization across the transport industry.
The Researchers Role
A growing concern in the industry of transport is sustaining and improving the world around us. I believe that as I become more involved and educated in this industry, this issue will remain one that drives innovation and will be responsible for the rise and fall of industry competitors. Through my research I have found that it is increasingly evident that policy and technology that work to reduce the amount of CO2 emitted in this industry will become an imperative part in the growth of the transport industry. As I have chosen this industry as a career, I will bring particular biases to this study. However, every effort will be made to be objective but the given biases may influence the way I view and interpret the found data. I will start this study with the perception that CO2 emissions is a growing concern that
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inherently effects all people of the world. The transport industry will benefit from this study in that the study examines the effects both adverse and favorable of CO2 emissions on the industry.
Bounding the Study
Setting- This study will be conducted through the comparison of past research procured via the library database at American Military University and specific government reports acquired from the internet.
Participants- This study will consider its participants as various modes of transport in the transportation industry. Sampling of data will be drawn from specific companies as well as industry averages of various transport modes.
Proceedings- Using the grounded theory research approach, the study will analyze the process of decarbonization and the views of the participants from the transportation industry concerning ways CO2 emissions have and will affect the industry’s climate change, policy, and development of technological advances.
Ethical Considerations- There are several anticipated ethical issues that this research will keep in consideration while documenting the findings and suggesting resolutions to the problems the findings may suggest. First, who should take responsibility for the reduction of CO2 emissions? Second, what sector of the transportation industry will be most affected by the change in CO2 emissions policy and technology? Third, which companies should do more to limit CO2 emissions? Finally, do more profitable companies have an obligation to help less profitable companies conform to new policy and regulations?
IV. Data Analysis
Data Recording Procedures
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The data in this study will be collected from January through February, 2010. This will include analyzing public documents of selected participants from various modes of the transport industry. Also, the research will weigh heavily on research from past studies with the intent to draw conclusions and make supported recommendations from the research being examined. Throughout my research I plan to record my own thinking, feelings, biases and perceptions of found circumstances and data.
In addition to analyzing qualitative data for themes or perspectives and merely reporting those themes, this grounded theory research approach will generate categories of information, climate change, policy, and technology, select an example from each category and position it within a theoretical model (Figure 1), and then describe a story from the interconnection of these categories (Creswell, 2009, p. 184).
Validity and Reliability Procedures
To ensure validity and reliability to following strategies will be employed:
- Data will be compared across various forms of documents to include, select company’s public information, government reports, and the collaborative findings will be compared to industry standards (Creswell, 2009, p. 191);
- I will reflectively comment on and clarify biases concerning my interpretation of the findings in this study (Creswell, 2009, p. 192);
- Discrepancies concerning the themes in this study will be addressed in an effort to show the findings in a more realistic and valid light (Creswell, 2009, p. 192); and
- Students in this class will provide a peer examination of the findings and procedures and methods used in analyzing and reporting data (Creswell, 2009, p. 192).
Data Analysis Table 3
Steps to Analyze Data Project Implications, Research Strategy, and Data
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Application of Theoretical Model for Data
The purpose of the above model is to objectively analyze the data and research that has been presented in this research proposal while keeping in mind that the purpose of this qualitative study to determine how transportation and logistics managers and businesses in the transportation industry can lower CO2 emissions through policy and technology with the end goal being total decarbonization. The model is composed of the collected data from the data analysis table and has been developed to further show the current results of research collected. To summarize, the model has been constructed by following the direction of collected data. The research has shown that policies and technologies will be implemented in the transport industry with the only variable being who will implement these CO2 reducing strategies. The model suggests, and the research supports, that there are more advantages to a company being proactive rather than passive in CO2 reduction policy restructuring and technological implementations.
Current CO2 Issues
In an attempt to provide a means to answering the research questions intended to guide this study, current economical issues must be addressed. In the forefront of the discussion concerning CO2 in today’s economical market are two issues: 1) The cost of reducing emissions and 2) How these cost impact employment of carbon emitting companies. The former will consider incremental costs, aggregate costs, and the distribution of costs. The latter will compare the effects of decarbonization cost and how these costs translate into potential decreases in the job market.
Characterizing the cost of reducing emissions provides a useful perspective on how controlling emissions would affect the economy (Congressional Budget Office, 2009, p. 2). The incremental cost is one way economist have measured the cost of emissions. This type of measurement explains that “for any amount of reduction, the incremental cost, or marginal cost, of cutting the last ton necessary
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reflects now much consumption of goods and services companies would have to forgo to eliminate that last ton of emissions (Congressional Budget Office, 2009, p. 2). If this principle is applied to a cap-and –trade system, the incremental cost would determine the market price of allowances. If a tax was imposed on emissions, “the incremental cost would equal the tax rate: Companies would make reductions that cost less than the tax; for the rest, they would simply pay the tax” (Congressional Budget Office, 2009, p. 2).
The sum of the incremental costs, or the sum of all resources that a company must give up to meet restrictions, is referred to as the aggregate cost. The Congressional Budget Office (2009) explains that approaching CO2 reductions with this type of system would cause a ripple effect beyond markets directly related to emissions and suggest that an ideal policy for CO2 emission reduction in today’s economic environment would measure the “overall effect of the policy on households’ welfare and would account for all such aspects of the policy as well as all the changes in behavior that might be triggered by the policy” (p. 2).
With these factors in mind, research has indicated how these potential costs would be distributed among industry, companies, and finally households. “Most policy would not only generate a cost to the economy as a whole but would also cause significant shifts of revenues among companies and shifts of income among households” (Congressional Budget Office, 2009, p. 2). It now becomes a question of which party will bear the biggest brunt of the shift. An indication of distributional impacts by considering the effects on purchasing power minus any associated compensations shows that “the loss of aggregate purchasing would increase from about 0.1% in 2012 to 0.8% 2050 (Congressional Budget Office, 2009, p. 12). So how do these cost impact employment?
The Congressional Budget Office (2009) suggest that the costs to reduce CO2 emissions would cause production and employment to shift away from industries related to the production of carbon-
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based energy and energy-intensive goods and services and “toward the production of alternative and lower emission energy sources, goods that use energy more efficiently, and non-energy-intensive goods and services” (p. 12). These events can cause job losses to be concentrated in particular industries, namely transport, forcing workers in this industry to work fewer hours or for lower wages or leave the labor force in this industry entirely. Now the issue that companies are faced with is lowering CO2 emissions at the cost of potential employees or abandoning the CO2 reduction effort all together.
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References
American Society of Mechanical Engineers. (2009). Technology and Policy Recommendations and goals for Reducing Carbon Dioxide Emissions in the Energy Sector. p. 3-25. Washington, DC: 971.pdf
Committee for the Study on the Relationships Among Development Patterns, Vehicle Miles Traveled, and Energy Consumption, National Research Council. (2009). Driving and the Built Environment: The Effects of Compact Development on Motorized Travel, Energy Use, and CO2 Emissions. p. 131-134. Washington, DC: U.S. Government Printing Office
Congressional Budget Office. (2009, November 23). The cost of reducing greenhouse-gas emissions. Washington, DC: Retrieved from - GHG_Emissions_Brief.pdf
EU Legislation. (2008). Transport and CO2. Retrieved from: http://europa.eu/legislation_summaries/other/l28049_en.htm
Macknick, J. (2009, August 31). Energy and carbon dioxide emission data uncertainties. Retrieved from
Rohrer, J. (2007). Abc of awareness. Retrieved from personal-growth-meaning-of-life
Sperling, D., & Yeh, S. (2009). Low carbon fuel standards. p. 57-66. Issues in Science & Technology, 25(2), Retrieved from -45d6-8de0-a842293d0846%40sessionmgr14
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U.S. Department of Energy. (2009). U.S. Carbon Dioxide Emissions from Energy Sources 2008 Flash Estimate. Washington DC:
U.S. Department of Transportation Federal Highway Administration. (2009). Highways and Climate Change. Washington, DC:
U.S. Department of Transportation Federal Highway Administration. (2008). Implications of Alternative Fuels on Transportation. Washington, DC: http://www.fhwa.dot.gov/policy/otps/innovation/issue1/implications.htm
World Economic Forum. (2009). Supply Chain Decarbonization. p. 4-31. Geneva:
World Energy Council. (2007). Transport Technologies and Policy Scenarios to 2050. London, United Kingdom. Published by: World Energy Council
